- US indices launched today's cash trading higher
- Tesla (TSLA.US) cut price of its vehicles in China
- Chinese tech stocks listed in the US under pressure
- US PMI below expectations
US indices launched today’s session higher, with Dow Jones and S&P 500 advancing over 1%, while tech-heavy Nasdaq trades slightly above the flatline despite the sell-off of Chinese stocks listed on the US exchanges. Investors welcomed last week’s WSJ report that hinted some Fed members are concerned about overtightening. San Francisco Fed President Mary Daly was among those who have this view, saying that the central bank should start discussing the potential of a smaller rate hike in December. Investors also digested weaker than expected flash PMI figures, which showed bigger than expected contraction of both manufacturing and services sectors. This week markets attention will focus on big-tech earnings, including Apple, Microsoft, Alphabet, Amazon.com, and Meta Platforms.
US500 once again is testing resistance at 3800 pts, which coincides with 38.2% Fibonacci retracement of the upward wave launched in March 2020. Should break higher occur, upward move may accelerate towards next resistance at 3900 pts which is marked with previous price reactions. On the other hand, if sellers manage to regain control, then another downward impulse towards support at 3500 pts, which is marked with a lower limit of the 1:1 structure, may be launched. Source: xStation5
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- Alibaba (BABA.US) stock plunged over 12.0% in premarket trading as disappointing GDP data from China weighed on sentiment. The Chinese e-commerce giant saw the price of its US ADRs dip below their 2014 IPO level of $68 per share.
- Tesla (TSLA.US) shares dropped 3.0% in the premarket after EV makers lowered Model 3 and Model Y prices in China by up to 9% due to weakening demand. Tesla competitors from China are also trading under pressure as President Xi secured a third leadership term and investors expect continued crackdown on the Chinese tech sector. As a result Nio (NIO.US) and Li Auto (LI.US) stocks tumbled over 10.0% before the opening bell. JD.com (JD.US) tumbled nearly 16.0% , Baidu (BIDU.US) slid 12.0% and Tencent Music (TME.US) fell 11%.
Nio (NIO.US) stock fell around 87.0% from its 2021 high. Stock launched today's session sharply lower and if current sentiment prevails, downward move may deepen towards $1.30 where 2019 lows are located. Source: xStation5
- Meta Platforms (META.US) stock fell over 1.0% in premarket after Bank of America downgraded its stance on the Facebook-owner to ‘neutral’ from ‘buy’, citing potential lower advertising spending.
- Williams-Sonoma (WSM.US) stock lost over 2.0% in premarket after Jefferies downgraded the housewares retailer to “underperform” from “hold” as a more difficult economic environment had a negative impact on the company's performance.
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